Equinix and GIC to set up JV to develop and operate hyperscale data centers in Japan
Under the terms of the agreement, GIC will own an 80% equity interest in the joint venture and Equinix will own the remaining 20% equity interest.
Global interconnection and data center company Equinix Inc (NASDAQ:EQIX) today announces the establishment of a greater than USD 1 billion initial joint venture in the form of a limited liability partnership with Singapore’s sovereign wealth fund GIC in order to develop and operate xScale data centers in Japan.
Under the terms of the agreement, GIC will own an 80% equity interest in the joint venture and Equinix will own the remaining 20% equity interest. The joint venture is expected to close in the second half of 2020, pending regulatory approval and other closing conditions.
Upon closing of this joint venture, GIC is expected to have contributed cash to fund its 80% equity interest in the joint venture. Equinix is expected to have transferred its Tokyo TY12 and Osaka OS2 development assets, along with development rights and the land for an additional data center in Tokyo, to the joint venture in return for a 20% equity interest in the joint venture and net cash proceeds in excess of USD 100 million.
Financing for the joint venture is also expected to close in the second half of 2020 and is anticipated to consist of a delayed draw term loan facility and a revolving credit facility.
The three initial facilities in the joint venture – one in Osaka and two in Tokyo – will serve the unique core workload deployment needs of a targeted group of hyperscale companies, including the world’s largest cloud service providers. With these xScale data centers, hyperscale companies can add core deployments to their existing access point footprints at Equinix, enabling their growth on a single platform that can immediately span 55 global metros and offer direct interconnection to their customers and strategic business partners.
The initial three facilities included in the joint venture will provide approximately 138 MW of power capacity to the Osaka and Tokyo markets when fully built-out.
